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How to best hire Professional Web Developers?

I am looking to hire professional web developers, but need some advice.
Is it better to hire individual web developer freelancers, or is it better to hire a web development FIRM?

It seems to be that hiring a professional web development firm would be much less riskier than hiring an individual. Most web development firms already have some established business, and should know what they are doing. Whereas individual web developers may not be as skilled and/or responsible, but I am assuming individuals are usually cheaper?
Is this a fair assessment? Any feedback would be appreciated.

As far as hiring professional web development firm, are there any recommendations as to which ones are reputable and reliable and are capable building dynamic interactive websites that can handle databases?

Hmm. I'm not sure that is an accurate assessment. I know of an organization that is in the process of dumping their design and development firm in favor of a one-person shop, because the firm didn't know what they were doing!

The best way to minimize your risk is to ask your peers for referrals. Meet with several different shops that have worked on projects similar to your own, and be sure to ask about the shop's established processes for delivering a project on time and on target.

You are bang on the button! I have outsourced for 5 years and I can tell you at times its been a nightmare, god damn unpredictable nightmare. My dog died, my aunty split up with her boyfriend, I broke my hand... You name it I have heard it. If you do find a good freelancer though, it can be good, but in 5 years I have found 2 that I still use - Crazy stuff.

But you can have the same experience with companies, just in my experience LESS often. About 2 years ago we started our own web development/design department and then 10 months ago turned this in to its own company. We can handle your needs with ease, based on what you just typed but I am sure many companies can too

What we do differently is our experience is based on 7 years of making money online and we still run eccomerce sites that turnover millions. All those split tests, all those multivirate testing, mouse tracking, user studies and lessons we learnt, get applied to your site.

<snip>

If your looking for freelancers, I would suggest the usual route of ELANCE

Freelance sites are a very good source for extremely talented programmers and designers. The secret is not to go for the cheapest and to check out their feedback once you have narrowed down your choice. Take a look at their portfolio and contact their previous clients by skype to make sure that the sites in their portfolio are really their own work. Make sure you have a contract in place and that all payments are made through escrow for additional peace of mind. I would also only deal with a freelancer who has good command of your language and be mindful of time zone differences because this can make communication erratic. Do not deal with companies that tout for business through the forums. If you are looking for someone through sitepoint I would suggest posting your requirements in the "looking to hire" section of the Marketplace.

There are three kinds of men:
The ones that learn by reading.
The few who learn by observation.
The rest of us have to pee on the electric fence.

If you're not technical enough to judge the guy by itself, if you don't have time to do so and if you have enough budget (since it is likely to be higher price since they offer the management service) better go for a firm.

Otherwise it's better to go freelance. I prefer freelance as for me because I'm used to manage Developers teams myself.